The clue is in the name: simplified advice questionnaires need to be … simple
Efforts to address the UK’s advice gap are both necessary and welcome. The challenge is to expand access to investment guidance and support without compromising consumer protection. While not easy to achieve, the FCA’s latest consultation (CP26-10) is a constructive step in that direction.
The consultation provides helpful clarity on approach: firms can continue to use attitude to risk questionnaires (ATRQs), but they are not required to rely on long or complex question sets. Instead, firms should take a proportionate approach, using tools that are appropriately designed for the service being delivered and the risks of the products involved.
This is an important message, and should not be interpreted as a move away from structure or discipline.
Proportionate does not mean unstructured
Understanding a client’s attitude to risk remains a cornerstone of good outcomes. Whether delivering streamlined guidance or full advice, firms need a clear and consistent way to capture how clients feel about risk and potential loss. Assessing a client’s capacity for loss is equally important.
A structured approach provides that consistency. It ensures key areas are covered, supports comparability across different types of clients, including those who pay for full advice, and creates a reliable record of how conclusions were reached. Without it, firms risk relying too heavily on subjective judgement—making outcomes harder to evidence and defend. Importantly, it can also highlight when a client’s responses are unclear or inconsistent, creating a natural point to pause and explore further.
Robust doesn’t mean complex
When it comes to processes, including online propositions, we often find glitches. Sometimes we find a single ambiguous question within a journey which could lead to a misclassification, an outcome no regulated firm wants to see. Or the customer may quit their journey due to confusion, thus perpetuating the advice gap. A single question usually requires customers to absorb jargon and definitions. In contrast, a concise well designed simple questionnaire will have been tested to ensure that customers, even those new to investing, can complete their journey easily and reach the correct destination. This is also true for short questionnaires designed specifically for targeted support.
In practice, effective ATR assessment is less about length and more about design. A concise set of well-constructed questions can deliver clarity and reliability. Each question should be purposeful, easy to understand, and tested to ensure it behaves as expected. Quality, not quantity, is what matters.
A foundation that scales
For many firms, a proportionate approach will involve a core set of robust ATR questions that can be used across different service levels. In simpler journeys, this provides a sound and efficient basis for guidance. Where customer needs become more complex, the same framework can be extended—adding depth without losing consistency.
This continuity is valuable. It means that customers do not need to start from scratch as their circumstances evolve, and firms can rely on a coherent, defensible approach throughout.
Closing the advice gap
Too often, honourable attempts to create simple, affordable propositions have been tested but not implemented. The FCA’s proposals set out to change this. Firms would be given greater flexibility to design processes that are proportionate and accessible, without being forced into unnecessary complexity.
The fundamentals remain unchanged. Assessing attitude to risk still requires structure, careful question design, and a clear scoring methodology. These are not optional extras; they are critical to the process.
Regulated firms should feel confident in using well-designed ATR tools for simplified advice. Done properly, they enable proportionate, consistent and customer-focused outcomes, supporting both the expansion of guidance and the integrity of advice.